USD/CHF falls on weaker US Manufacturing PMIs, soft Swiss inflation data

• S&P Global and ISN Manufacturing PMIs entered the recessionary territory as economic conditions in the US tightened.
• US Treasury bond yields and USD plummet following poor US manufacturing data.
• USD/CHF Price Analysis: A symmetrical triangle in downtrend warrants further low prices.

 USD/CHF tumbles 0.17% after hitting a daily high of 0.9196 on softer-than-expected inflation in  Switzerland. Nevertheless, a weaker manufacturing activity report from the US reversed the USD/CHF pair course, as investors estimated the US Federal Reserve (Fed) would pause raising rates. At the time of typing, the USD/CHF is trading at 0.9137.

Swiss Franc Bolstered as US Manufacturing Data Misses Estimates

The Swiss Franc (CHF) got bolstered after US economic data, namely the S&P Global and ISM Manufacturing PMIs, came worse than estimated. The S&P Global Manufacturing PMI for March was 49.2, below 49.3 estimates. Later, the Institute for Supply Management (ISM) revealed its Manufacturing PMI, which plunged to 46.3, below the 47.5 foresaw and below February’s data.

Consequently, US Treasury bond yields and the US Dollar (USD) plunged. The USD/CHF extended its losses past the 0.9150 area, hitting a low of 0.9115.

The US Dollar Index (DXY), which tracks the performance of six currencies vs. the US Dollar, drops 0.39%, down to 102.196. the US 2 and 10-year Treasury bond yields are dropping two and four basis points each, at 4.005% and 3.430%, respectively.

Inflation in Switzerland came softer thane expected, with headline data at 2.9% YoY vs. 3.2% estimates. Core inflation rose by 2.2% YoY, below the 2.5% foreseen in February. In March, the Swiss National Bank (SNB) lifted rates by 50 bps to 1.50%, and its Governor, Thomas Jordan, said, “ It cannot be ruled out that additional rises in the SNB policy rate will be necessary to ensure price stability over the medium term.”

USD/CHF Technical analysis

From a daily chart perspective, the USD/CHF is extending its downtrend. After forming a descending triangle in a downtrend, the USD/CHF broke below its bottom trendline, suggesting that further downside is expected. Therefore, the USD/CHF first support would be 0.9115. A breach of the latter will expose the figure at 0.9100, immediately followed by 0.9059.